Quarterly report pursuant to Section 13 or 15(d)

Net Loss Per Common Share

v3.10.0.1
Net Loss Per Common Share
 6 Months Ended
Jun. 30, 2018
Earnings Per Share [Abstract]  
Net Loss Per Common Share Net Loss Per Common Share

Basic net loss per common share is computed by dividing net loss available to common stockholders by the weighted-average number of shares of common stock outstanding during the period.
 
Diluted net loss per common share is computed by giving effect to all potential shares of common stock, including stock options, restricted stock units, market stock units, performance-based RSUs, potential ESPP shares and instruments convertible into common stock, to the extent dilutive. For the three and six months ended June 30, 2017 and 2018, basic net loss per common share was the same as diluted net loss per common share, as the inclusion of all potential common shares outstanding would have been anti-dilutive.
 
The following table sets forth the computation of historical basic and diluted net loss per common share:
 
 
Three months ended June 30,
 
Six months ended June 30,
 
2017
 
2018
 
2017
 
2018
 
(in thousands except per share amounts)
Numerator
 
 
 
 
 
 
 
Net loss
$
(275,136
)
 
$
(91,982
)
 
$
(407,403
)
 
$
(223,687
)
Less: Stock dividend payable and transaction costs
14,528

 
7,473

 
14,528

 
14,836

Net loss available to common stockholders
(289,664
)
 
(99,455
)
 
(421,931
)
 
(238,523
)
Denominator
 
 
 
 
 
 
 
Weighted-average basic and diluted common shares
241,320

 
259,822

 
239,428

 
256,397

Net loss per common share, basic and diluted
$
(1.20
)
 
$
(0.38
)
 
$
(1.76
)
 
$
(0.93
)

 
The following potential common shares outstanding were excluded from the computation of diluted net loss per common share because including them would have been anti-dilutive:
 
 
As of June 30,
 
2017
 
2018
 
(in thousands)
Shares issuable upon conversion of preferred stock
16,488

 
48,163

Restricted stock units
21,739

 
27,461

Shares issuable upon conversion of 2023 Notes
—

 
20,154

Options to purchase common stock
9,384

 
6,541

Performance awards*
1,993

 
1,016

Shares issuable pursuant to the ESPP
589

 
988

Total common stock equivalents
50,193

 
104,323

*Includes potential common shares outstanding for MSUs and PSUs
 
On December 9, 2015, we completed an offering of our 1.75% convertible senior notes due 2020. As we have the intention to settle the 2020 Notes either partially or wholly in cash, under the treasury stock method, the 2020 Notes will generally have a dilutive impact on earnings per share if we are in a net income position for the period and if our average stock price for the period exceeds approximately $16.42 per share of our common stock, the conversion price of the 2020 Notes. For the period from the issuance of the offering of the 2020 Notes through June 30, 2018, the conversion feature of the 2020 Notes was anti-dilutive, as we were in a net loss position for all periods and our average stock price was less than the conversion price.

In connection with the pricing of the 2020 Notes, we entered into Capped Call Transactions which increase the effective conversion price of the 2020 Notes, and are designed to reduce potential dilution upon conversion of the 2020 Notes. Since the
beneficial impact of the capped call is anti-dilutive, it is excluded from the calculation of earnings per share. Refer to Note 11 "Debt Instruments" for further details regarding our 2020 Notes.